Obama To Bail Out Underwater Homeowners | Fannie Freddie to FORGIVE Negative Equity?

WOW - guess we will find out soon how good these sources are!

Crazy...and who will it be for? I'm guessing not for middle class America...interesting timing too.

The government will not allow this market to correct itself.  So sad.  We will all be paying for all this bailout for EVER!!!!!! and EVER!!!!. I see no end to Obamas social policies.

Where is the basis for this rumor?  It sort of reminds me of end-of-the-earth on such and such date prophecies.  Not sure what I think about it - I don't have a knee-jerk reaction one way or the other - but it seems to be conjecture and even more implausible with a date attached.

Liz

I dont know the true ramification of this but it will not go well for all involved.

Robert, that is a great comment.  It made me laugh out loud!!

Tim,

I only partially agree this would be a good thing. In the near term it would help underwater home owners. However it doers not address the stronger underlying issues in the economy – mainly unemployment.

Also, as you mentioned, it piles on a huge federal debt. The amazing rate at which the federal debt has grown in the last two years is making people very nervous. I think the long term effects would be negative.

There are sure a lot of proposals by the current administration to help accidental homeowners to delay returning to the rental market for a few more months.  I find it incredible that absolutely nothing is being done to assist the thousands of folks with good credit, folks who can afford payments on a higher priced home that fits their current needs.  The segment of potential buyer to which I refer is the homeowners who have negative equity in their homes, who have excellent credit, who have outgrown their current home, but have to sit for years trying to reduce the negative equity brought on by price erosion.  If there were a program to, not forgive, but rather allow the transfer of the negative equity to a new home and loan, there would be a lot of industry stimulation for a very low cost.